middle income trap

• middle-income trap

Coined by Indian economist Indermit Gill and economist Homi Kharas in 2007 in their book An East Asian Renaissance: Ideas for Economic Growth.

middle income trap (plural middle income traps)

1. (economics) The situation where a country that attains a certain income gets stuck at that level, being unable to compete with other more developed economies in the high-value-added market. [from 2006]
   • 2010 December 23, Simon Roughneen, “Vietnam: a development success story?”, in The Guardian‎:

     Thailand and Malaysia are hemmed in by the so-called "middle-income trap", which suggests that while countries can move up from the ranks of the very poor, moving further forward is more complex, as competitiveness falls off and costs for investors increase.

   • 2021 July 1, Vincent Ni, “‘Poverty divides us’: gap between rich and poor poses threat to China”, in The Guardian‎:

     Chinese economists have for many years also worried about the “middle-income trap”, a situation where a country that has reached a certain level of income gets stuck for a long time.